Rob Balena 0:00

There needs to be a willingness and testal fortitude to weather the long journey to enterprise success. Finding good salespeople is one of the hardest things. Do you have the runway and the stomach to play long ball? That's the only way to do large strategic deals. When you take a message that resonates with a VC, it's going to potentially scare some risk-minded folks at large enterprise. Show me how it hits the PL of the site. That's interesting. That's something that I can take to operational. So your job is to convince them that you are the safest place for their destiny. And the reason is not because of your size, because you can get them to the other side, to what you're promising. The end state is not the close of business. The end state is whatever implementation goal you promised to them is achieved.

Andrew Kazlow 0:54

Welcome to the Diligent Observer, where we help angel investors see what most missed. I'm your host, Andrew, and every week we explore what works, what doesn't, and why through conversations with experienced startup investors and operators. Today, I'm replaying one of the single most useful podcasts I have ever recorded. Why is that? Because it's all about how startups should, and more importantly, should not sell to enterprise buyers. My guest is Rob Bolina, who has spent years selling startup tech into Fortune 500 accounts. Now, Rob explains why the pitch that gets a startup funded can actually scare off enterprise buyers. He walks through how to tell whether a big logo on a pitch tech is a real thing or if it's just a one-time favor. And he breaks down why a BP of HR once told him that a 39% drop in absenteeism didn't matter at all. I hope you enjoy learning from Rob as much as I did. Rob, thanks for being with me today. So excited to be here. Thanks for having me. Okay, so Rob, I'd love to start with just what's exciting in your world right now, either at TeamSense or things happening in the broader kind of sales ecosystem that you find exciting.

Rob Balena 2:16

My passion has always been walking alongside customers and helping them transform. I love finding people that are trying to solve problems on the ground level, building a story with them, and then taking that to corporate executives. And in my role at Team Sense, I get to do that more and in a different way than I ever really have before. We sell primarily to manufacturing companies, which is a new industry for me. And so I've sort of traded my wingtips in for steel-tote boots. And instead of spending time touring data centers, I now am touring manufacturing facilities, which is really interesting. You feel like a little kid when you're in there watching trucks get built or engines put together. But then also really getting to hear the ways that software can improve the lives of people that a lot of the tech industry has ignored for a very long time, right? The hourly workers in factories. And so that's really exciting to me here at Team Sense. I think broadly what I'm seeing is there really seems to be a shift. I wonder if it's, you know, post-COVID, COVID everybody went remote. Everything was very much done over Zoom. And I think there's still sort of a reticence among sellers to get out in person and to be face to face with customers. And so that's unfortunate. I mean, that being in person is such a force multiplier in the go-to-market world. But for someone like me that loves to be in person, it's actually an advantage because it does set us apart. In fact, I've had customers tell me and tell folks on my team, like, we went with you because you're real people and you came to visit us. And we've we had this previous vendor and we we've never met anybody in person. And so uh I do see that as a shift, as maybe a swing back to the traditional field sales of being in person and seeing the tangible impact that makes on outcomes for sellers.

Andrew Kazlow 4:05

What's old is new again. Yeah. So you said something interesting just now. Uh it sounds like this transition from large data center focus to manufacturing has been quite a transformation in terms of target market. What are some of the things you've seen that are consistent in terms of your sales motions and the way you go to market? And what are some of the nuances that you found between those two markets?

Rob Balena 4:35

The way that large organizations buy is pretty consistent, right? There's a huge focus on reducing risk. There's a huge focus on understanding outcomes. One of my favorite go-to-market people in the world is Todd Capone, the author of The Transparency Sale. And he's famous for saying that people buy when they have certainty, when they know what the outcome will be, even if they like they need to understand what the potential downsides are before they're willing to buy. That's pretty consistent. And so building a business case and helping all of the stakeholders in a large organization understand not just the pie in the sky vision of the software, but how do we help you get from where you are today to where you're going to go next? That's pretty consistent. I think that's just buying behavior in general, building consensus across multiple stakeholders, understanding the pains and the potential benefits for different stakeholders is all pretty consistent. What's really unique about the manufacturing industry, I think what surprised me initially coming to Team Sense is how independent some of these facilities are. And in fact, one of the first things that I did when I came in as head of sales was I looked at, okay, we've got fantastic logos, but it's typically at a single site. We've got a single site where we're covering their hourly workforce. How do we expand to other sites? And I was surprised to find that many times our contracts were not with the corporate entity, but with a wholly owned subsidiary that had the corporate name plus the site name with it. And so, in many cases, going to a different site or trying to do a corporate level expansion meant starting from scratch from a legal and procurement perspective, which was a big lift. And so that's been surprising to me. World that I've previously come from, I was at Cloudera where I sold mostly to either tech companies or to, you know, IT within large companies. And they're pretty well enmeshed in the corporate structure. And so what you see is what you get. The last thing that I'll say too is this is the first role for me where I'm selling primarily to HR and then tangentially into operations at the site level when we're starting there. And compared to selling to folks in IT who buy a lot of software, run a lot of projects, know kind of where the bodies are buried, how to navigate the structure, folks that are at an operating facility in HR, many times they're buying software for the first time or they're running a project for the first time. And so my role takes on an additional layer of project management, almost helping them kind of think through how do we get this purchase done? And then what do we need to do post-purchase to prove the value that we promised to the organization and show that to them?

Andrew Kazlow 7:19

It's an interesting point on the kind of isolation of different nodes within a broader organization. Do you think that's consistent across other heavily physical enterprises as well, like healthcare companies or hospitals? Help me draw the distinction between that highly individualized client base within a broader corporate umbrella. Like is that multi-industry, or do you think that's unique to manufacturing?

Rob Balena 7:46

I think what's unique about manufacturing, and I'm painting with broad strokes here, but the these facilities and the plant leaderships, it's usually plant manager or a general manager, they are running a PL for that facility as if it's its own business. And sometimes legally it is, right? It's it's legally its own business. And so there is more isolation. There's like a shared services model that comes from corporate, but in the day-to-day operations and how they run and manage their business, a lot of that is left up to them. And I do believe that has to do with the physical nature of the manufacturing industry and the fact that there is so much PL focus site by site. One of the most interesting examples of that is we had a great relationship with a general manager at it was a logistics company, and they had this great story about how Team Sense had saved them all kinds of money and overtime costs. And we're like, okay, well, let we want to take this story to another plant, to the plant that's across state lines. In my experience, when I've had experience with folks in IT or you know, a sub-team within IT, and they have a big win, they want to share that with everybody and show everybody, hey, look what we did. In this case, though, there was hesitation. It was like, in some ways, that plant leader is competing with his peers that are at the other plants. If he's found an unlock that helps him save a bunch of money or lower his cost of labor, there's this tension of, well, I want to do right by the company and I want to bring the tide up and raise all ships. But at the same time, like you've given me an edge here. And this is there's a friendly level of competition. And so that was something I'd never experienced and was a little bit surprised to see that level of isolation.

Andrew Kazlow 9:26

It's Charlie Munger. Show me the incentive and I'll show you the outcome. Uh there it is, pure and simple. That's fascinating. Okay, Rob, so I want to double-click on your framework, your mental model for assessing go-to-market strategy. You have worked with multiple small companies selling to big companies. That's not an easy thing to do, but you love it. And that is a pitch that many an entrepreneur makes to an investor. Probably half of the software companies that we look at at the early stages are painting this corporate sales customer. They're showing these cool logos like you just mentioned. I'm curious to understand what is your framework? What are the key questions that you would ask if you sat down with a new entrepreneur, small team, sub-five people aiming to go to market with some of these large enterprise clients? What are the questions you would ask? How would you deconstruct their pitch deck?

Rob Balena 10:30

I mean, they have picked potentially the hardest path, right? So for me, there needs to be a really good product reason why that is the direction, why that's the fit, why we're gonna go after large enterprises and we're gonna go after long sales cycle, large dollar deals off the bat. When I ran my coaching business and I would interact with very small startups, and one of the biggest challenges I saw with them is that they would oftentimes pitch to large enterprises the same way that they pitch to their VCs. And so the same story that got them funded makes sense, is well, that that should get us a sale at this large company. And one of the unlocks, I think, for them was realizing very different organizations, very different group of people, typically VCs, much smaller group of people, fewer stakeholders, and it's people that are literally in the business of taking risk. They are looking for high stakes, high return types of ventures. A large enterprise is for the most part very, very different. They are, by their very nature, risk averse. A publicly traded company has organizational institution and structure to avoid risk. There are risk departments. And so when you take a message that resonates with a VC, something about we're the very bleeding edge of a particular technology, or we're doing something that nobody's ever done before, that may get some VCs very frothed up, but it's going to potentially scare some risk-minded folks at large enterprises. And so the pitch needs to be tailored to the enterprises. I think what what I would peel apart too is do you have the runway and the stomach to play long ball? That's the only way to do large strategic deals. And it can be very easy at the beginning stages to say, yeah, you know, we're going to do the right thing. We're going to build these relationships over time. We're going to build a business case that's locked tight. We're willing to put in the time and the effort to do that. But then as quarters go differently than you expected, and as pressures from the board mount, suddenly there's a very large temptation to do some short-sighted things. And in the course of working towards a strategic relationship with a large enterprise, there are absolutely opportunities where you can pull a stringer or yank on some leverage to try to get a quick deal. You're going to do that with that customer exactly once. And you're mortgaging your future with that customer. There needs to be a willingness and intestinal fortitude to weather the long journey to enterprise success. And then they also would need to show me a very clear plan of how you're going to find sellers that are going to come sell for you. When I think about the reasons why a seller who knows how to operate at a VP or C level, why would that type of person go work for a startup? Enterprise sales is already very, very risky, right? An enterprise seller has fewer accounts. Each deal they close is a large proportion of their quota and thereby their earnings. And so why layer on an additional set of risk of going to a startup that's unproven that maybe there's not even a product market fit? Maybe there's not a history of success yet. And usually the answer is a small startup gives them an ability to do a broader set of things. They're not quite so much a cog in the wheel, right? They're able to wear more hats. They want more of that autonomy and freedom that they're not going to get at a larger organization. I also hear sellers say things like, if I can find an organization and ride the hockey stick, then that's a way to earn a lot of commissions. When a startup hockey sticks, necessarily the quotas have to grow very quickly, which means that there's a period of time where the high-performing sellers are going to be massively outperforming their quota and have huge earning potential. And then equity, of course, is a big one. And so that has to be part of the picture if you're looking to attract top sales talent, especially at the enterprise level, because they're going to be playing long ball. They're going to be investing a lot of time with very little return until those come to fruition. I think a lot of founders over-rotate on the vision or the mission, which of course they do, right? It's their baby. They created it. They're the ones that believe it most deeply. But I often see folks say, well, we're going to attract the best talent because we're doing something really amazing and people are going to drink the Kool-Aid and they're just going to want to be here. The hard truth is like, while belief, I think is maybe one of the most important parts of sales for me in particular and for sellers in general, you've got to believe in what you're selling. No one is going to believe in the mission or vision of your product or your company as much as you, the founder. And that can't be used as leverage to manipulate lower comp or lack of equity for a seller when, if they're worth their salt, they could probably earn much more dependable revenue at a larger company.

Andrew Kazlow 15:40

I want to poke on something you said about these quick wins, kind of pulling leverage and getting a logo all of a sudden, but that you can do that exactly once. If I'm an investor and I see a couple of impressive logos on that pitch deck, how do I suss out if that's a quick win? They pulled the strings and this may or may not happen again, or there's real potential there. What are the follow-up questions you ask to discern that without really being able to know? It's tell me the story, right?

Rob Balena 16:09

And that's the same thing I do when I interview salespeople is you can suss out very quickly if someone was intimately involved in the transaction when they tell you the story. And if you know, pull a particular logo and you ask them to tell you the story and it's generalities, you either need to dig deeper or you need to be really concerned. I've joined Cloudera, which is a big data, great, great, successful company, IPO'd. I joined as part of an acquisition and came into an underperforming territory post-acquisition, which was a little bit of a culture shock because I'd been on this wild rocket ship ride at Gazang and we were acquired, and then I was like, oh, here's this terrible territory. But uh I was in Central Texas, and one of the accounts that they gave me was Dell, which sounds like a great account, but they were exclusively using our competitor, and there was like there was not a lot of opportunity there. But at the time I had a sales engineer and a boss who were both willing to walk the long road with me. The mission there was let's get a beach head, let's plant our flag in whatever way we can, and then shout that story from the rooftops, make those people so wildly successful that everybody has to look and see what we're doing. So that's an example of, yeah, we did get a small quick win by design. We went and found some people that were doing some very disruptive things that wanted to try something new. They needed a lot of hands-on in-person support. And I was not far from the Round Rock headquarters. And so I was like, great, we'll be here every Tuesday and Thursday, right? We'll just kind of hang out with you and help make this happen. But that was all in service. And even the customer knew this. We were building a story and we're tracking our progress because we want to share this not just with your peers, but with your superiors and their superiors over the course of what ended up being about three years, unseating that competitor to take over the account. That would be the story I'm looking for. If I'm an investor and a startup comes in and they've got big logos or with little implementations, I want to know are you strategically working with whoever it was that took a very big chance on you to craft a story to go get more from that customer and make them successful? Or did you have an executive relationship that you leaned on? Was there a larger opportunity and you pulled a string, you threw a big discount at them to get them in the door because you just wanted to take it off the table? That's a very different story than we have a strategic plan that's months or years long to take over this account.

Andrew Kazlow 18:36

One of the other things that related to this that I find myself asking when speaking to these entrepreneurs that are going after these large enterprise accounts is what happens if they say yes? What happens if they hit go? How do you think about positioning for scale and positioning for rapid growth in fulfillment and all of that? Because if a big enterprise in theory gets to the full scope, it's okay, I need 10,000 units tomorrow. Can you make it happen? The answer is always uh yes. Am I thinking about it the right way, or is it usually more of a slow roll?

Rob Balena 19:12

Let me start by saying, and I've even seen this at Team Sense, I think there's a this desire amongst many people to not share your size when you're a tiny startup trying to sell to a big company. It's like, well, we have to make ourselves look bigger than we are. I don't believe that's true. At best, it's like you're throwing some smoke. At worst, you're outright lying to people. I think what you do want to show them is competence. You want there to be no question in their mind that their future is best suited with you. And many times for many large enterprises, that means they want to work with a large market leader because the risk is lower. And so your job as the founder, the enterprise salesperson, whatever, is to convince them that you are the safest place for their destiny. And the reason is not because of your size, but it's because you're competent, because you know the path, because you can get them to the other side to what you're promising for them. And then through the sales process, that's a big part of qualification. And I've heard the definition of qualification being like knowing how you lose and uncovering it as early as possible. Well, if you're a tiny startup, one way you potentially lose is you cast a big vision and you get a whole bunch of people really excited, and then you can't deliver because your product doesn't scale or you don't have the means to fulfill it. And so part of qualification during the process is putting the customer in the mind of post-implementation and having them with you craft what that world looks like so that you and they both have a very clear understanding of what's happening. It's just sort of like sales tool that I've always used throughout my career is a mutual action plan and there's mutual close plans and all these different versions of it. I think what I've found most effective is when you have a plan that is collaborative with the customer. It's something that you pull up on the Zoom or you put up on the whiteboard with them together, and you're both editing it in real time. And that the end state is not the close of business because that really doesn't matter to the customer. The end state is whatever implementation goal you've promised to them is achieved. And so, in in my case, at Team Sense, we say we reduce absenteeism, and that reduction in absenteeism in your hourly workforce results in lower overtime costs, lower uh labor costs. The end goal is that. It's the seeing the costs of labor come down. It's seeing that crest and start to come down. That's the end goal. And that's what you want to track towards with the customer. If as early as possible, you can start getting them in the mindset of what's the world going to look like post-implementation, they're gonna uncover for you very quickly. First, we'll roll out to North America, and then it'll be the EU. And you're like, oh, whoa, whoa, whoa, we've never done better. Business in the EU? What do we need to be GDPR certified? Or what are the things that we need to be aware of? And that'll help you uncover the potential pitfalls.

Andrew Kazlow 22:08

Where do you see inexperienced salespeople andor entrepreneurs screw up in this process of casting that vision and focusing on the outcome? What are some of the more common pitfalls? Maybe this pull the strings and get the quick win rather than focus on the long outcome, like you talked about earlier. What are the common mistakes that you see?

Rob Balena 22:28

I think being too short-sighted and judging short or long-sightedness on your customer's scale, not yours, the life cycle of a VC back startup is short and fast and furious, and things happen very, very slowly at large enterprises. And so when you say I'm playing longball to a large company that's 100 years old, that could mean a couple of years. So that's certainly one, I think, tailoring your pitch to that audience, making sure that you are attaching what you do to a tangible impact, and that those tangible impacts are impacts that matter to that customer. My favorite example of this at TeamSense is we were working with a company called Kenco Logistics, their big third-party logistics company. We had deployed at a single site, it's north of Atlanta, very successful initial deployment. And we saw their absenteeism rates go down. They were struggling with absenteeism. Their absenteeism rates came down by 39%. And so we were like, oh my gosh, this is amazing. And so the seller and I, we went to the general manager and we said, hey, we broker a meeting for us with who is it on the executive team that cares? Is it VP of HR? Is it VP of ops? Who cares? And so he was willing to do that. He got us a meeting, and we walked in with like some swagger because it's like, oh my God, we had this amazing implementation. We've got the GM and the head of HR for the plan just like singing our praises, and we have this measured impact. The absenteeism dropped by 39%. Look at this beautiful chart. And I remember the moment very clearly, the VP of HR, she looks at me and says, uh, yeah, that doesn't matter. And I'm like, what do you mean that doesn't matter? And she's like, well, it's I need to understand the tangible impact. Like tangible, it's tangible. It's right there on the screen in front of you. More people are coming to work. It's a reduction in absenteeism. It's not tangible unless I understand how it hits the PL of that site. Show me that. Show me how it hits the PL of the site. That's interesting. That's something that I can take to operational leaders. But if we have the same throughput efficiency and we're moving the same number of pallets from one side of the facility to the other when absenteeism is X percent versus Y percent, it doesn't matter unless it's affecting that outcome. So go show me that connection, draw that line. So that's what we did. We went back, crunched the numbers, and we found this deep connection between absenteeism and overtime costs. And then in their particular case, they were actually overstaffing shifts to account for unplanned absences. So if the shift called for 100 people, they would staff 103, expecting that three people wouldn't show up unexpectedly, and then they've got a full shift. Well, that resulted in a whole bunch of wasted money because if everybody did show up for the shift, then you're having to pay usually a half day's wage to those folks and send them home, or they're going to stay on and you're paying them anyway. And so we were able to show the reduction in those costs because of the reduction in absenteeism. And that's what unlocked Kenko for us. Then it was hair on fire. How do we roll this out to as many of our sites as we can? Because look, it's a huge tangible impact to the PL.

Andrew Kazlow 25:35

A quick note before we continue the conversation. Alongside the Diligent Observer Podcast and Newsletter, I also run an outsourced operations service specifically built to serve angel networks. My team handles things like initial screening, social media, newsletter prep, platform management, and a whole lot more. The kinds of things that either aren't getting done or shouldn't be done by busy community leaders. If that sounds interesting to you, send me a note. Now, back to it. That's an amazing story. So basically, this completing the circuit, essentially. You guys had most of it, but you didn't take it to its final conclusion into what actually bottom line mattered.

Rob Balena 26:12

If I can even put another turn on it, since then, and what do we do as a small startup? We're like, hey, that worked once. Boom, stamp it, let's do it everywhere. Well, not every company has the same labor practices that Kenco has. Not every company cares about overtime the same way that Kenco did. Some companies are unionized and they're controlled by a CBA. And so there have requirements around overtime or overstaffing that are independent of absence rates. And so it's not just completing the circuit and drawing that very clear line to a tangible impact, but it's got to be a tangible impact that matters to the customer. You can't just throw this into a white paper and blast it out to everybody and be like, all right, I'm ready to receive your deals. I'm working with another customer. And I won't mention their name because they're not a referenceable customer quite yet, but they make household items and they have a goal for each shift. And it's called their million thing incentive, this thing that they make. They they want to see if they can make a million per shift. And if they make a million per shift, then that shift gets an incentive, right? And as I'm speaking with the leaders at this site, and I'm trying to understand what are the metrics that matter to you, what are KPIs that we might affect that are going to resonate with folks. And I tried on the overtime thing, I tried on the overstaffing thing. And they're like, well, you know what it really is? We haven't hit the million thing incentive in months. Like we used to do it consistently all the time. But since absenteeism went up, we're having trouble. And I was like, guys, that's the thing. If we can implement Team Sense, reduce absenteeism, show better engagement with the workforce. But if that then results in you hitting that incentive more consistently, if I go tell that story to corporate, are they going to know what that is? Like, oh yeah, that's their thing. They say that all the time, the million thing incentive, right? Great. That's the story I want to tell.

Andrew Kazlow 28:04

As you're talking, it sounds like finding the actual message, the actual thing that's important that top-to-bottom people care about, like CEOs, all their broad messaging, but what's the thing that actually filters all the way through the organization? That's what you have to connect the sales message to in order to really get top-to-bottom buy-in.

Rob Balena 28:23

What's the thing that when you say it out loud, everybody rolls their eyes because they hear it at every audience? If you can connect to that, an example of this is we did this at Dell at Cloudera. We found a series of blogs by their CIO, and it was called Dell on Dell. And he would, on a regular basis, share stories about how the finest examples of the use of Dell hardware and Dell products was inside of Dell IT. They wanted to be the lighthouse customer for all the products that they sold. And they said, Hey, customers, Dell customers, do you want to see what great looks like? Look at how we use our own stuff internally. Dell on Dell was his thing. And so we found that and we started saying that around the office at Round Rock 2 and everything, right? Dell on Dell, people would roll their eyes, people would roll their eyes. But that was how I got my initial beach head was because I got into a room with some detractors and I said, you know, I've been reading this blog, Dell on Dell, and I got to ask you, I know because there's a partnership between our companies, that you recommend to your customers that they use Cloudera on Dell machines, but you're not doing that internally. So help me understand why we're not doing Dell on Dell here. Shouldn't we be able to tell your customers that the largest, most successful deployment of Cloudera on Dell hardware is inside Dell IT? And that was that was the banner that got folks charged up enough to take a shot at putting up putting us in in spite of it being a competitive account.

Andrew Kazlow 29:52

Rob, I'm listening to you. I'm a founder. I'm like, oh my God, I need this guy, or somebody like him on my team because that was amazing. Like those stories, let's say I'm a technical founder or I'm just not a great communicator. I don't see myself in the sales seat long term. You talked a little bit about this earlier. How do I convince somebody like you to come work for me? The vision is important, right?

Rob Balena 30:15

The story that you're telling is important. Don't over-rotate on that. Don't believe that that will necessarily get someone on board that also has financial goals for themselves and career goals. I think finding good salespeople is one of the hardest things in the world. Sellers are notoriously great in interviews, right? They're good at selling themselves. And I know many sales leaders that have just been so excited about a new person on their team, and then the person gets in to seat. And for whatever reason, sometimes it's not even that they're they're bad salespeople. It's just maybe it's not a fit. There has to be a fit between the seller and who you're selling to. I think if I can offer a couple of things, I would say look for someone that either has some history being at smaller companies because they've got that experience of wearing different hats and trying different things and being disruptive. Or look for someone that's been at a larger company. Nothing wrong with larger companies. In fact, the enablement and training at a large company is amazing, especially if someone's right out of school, right out of college. I went to work for a startup in sales. I didn't know what the heck I was doing. They tossed me into a territory and that was it. Like I had to figure it out. There is fantastic training and enablement at larger, more established companies, but you need to find somebody that has that entrepreneurial mind and have wants to be innovative and disruptive and maybe probably chafes a little bit at the organizational structure and the red tape because they want to do things that are new and different. One of the biggest challenges for me going from Gazang, which I think at the time of acquisition, we were 65 people or something, to Cloudera. And at the time it was when they acquired us, we were 600. And then I stayed with them, I don't know how big we got, but thousands. You know, at Gazang, I'd be working on a deal and put the phone on mute, bang on the wall, to Larry Warnock, my CEO, or Patty Sock, my CFO, and be like, hey, what about this? Can we do this? Yes, go for it, right? Um, and and here at Team Sense, I'm blessed with a leadership team that they trust me to find the balance between advocating for my customer and protecting the company. And they give me a lot of leeway to find a path forward within that. You don't get that freedom and autonomy at a large company. And so if you find someone that enjoys that and can do it responsibly, that's a great thing to do. I think the the absolute best thing to do when you're evaluating sellers, though, is get them to tell you stories because storytelling is such an essential part of sales. You want to understand if they can succinctly tell you a story that's compelling, that has uh a moral at the end or a lesson that they learned. You want to know that they have intimate knowledge of the inner workings of a deal, how they got in, how they pitched, what was the vision that they cast for the customer, and then what was the nuance of contract negotiations and pricing negotiations, and how did you do that? I don't want somebody that's never been through that, right? If I'm doing that for the first time at a startup. And then another question that I like to ask is tell me who the best salesperson you've ever met is. Who's the best salesperson you've ever met? And that will illuminate for you what this person values and who they want to be like. So if you say who's the best salesperson you've ever met, and they say, Well, I want to be like Rob because he was the top salesperson he made the most money. Okay, fair, fair answer, but that lets me know that you value like your own performance and earnings above everything else. I asked that question one time and the person literally answered me. I'm the best salesperson I've ever met. I was like, all right, this conversation's pretty much over. I don't need to hear anymore, I don't think. I also asked that question one time to a candidate and they said, I forget her name, Mrs. Smith. And I said, Who is Mrs. Smith? And they said, My third grade teacher. Why is she the best salesperson you've ever met? Well, she got me excited about school. Up until third grade, I couldn't care less. And she was the one that convinced me that it was worth to apply myself in school. And I was like, oh my gosh, what a cool answer. And what does that tell me about that individual? That's the kind of person I want on my team, somebody that sells through inspiration and because they truly want their customers' lives to be better and they believe that that can happen through software.

Andrew Kazlow 34:27

Let's flip that around. What are some of the questions that you would ask the CEO that you're interviewing with? If let's say you're a sales killer, you've got all the chops, all the right options. What are some of the key burning questions that you would actually be focused on asking of the CEO?

Rob Balena 34:45

Uh I need to know what stage the company is in truly. Do you have product market fit? Is this a, okay, we've figured it out and we're scaling kind of motion, or is this a we don't have it? Like we we we need to figure out even what resonates with customers, and there's gonna be a ton of experimentation. That matters, it's gonna be a very different experience for a seller if you're handed a playbook that you have relative faith is gonna work, and your job is simply to execute at a high level. That's a very different role than, hey Rob, come help us figure out how to sell this thing. We've got this thing, we know there's something there, it's investable, but we haven't quite cracked the nut on how to get companies in on it. That's not a bad thing, but as a seller, I need to know that. I need to know what I'm walking into because that's a very different role in a lot of experimentation and figuring things out. I would want to know, I think there's some logistical basics. How is the product licensed? What does the contract look like? I want to know that I'm going to be representing something that's easy to do business with, that where just the buying process is not a hindrance to me making sales. It's hard enough for a startup to get deals done, but when you have an odorous contract or uh a licensing structure that just doesn't make sense, not aligned with how people buy, that can be challenging. And then I think I also want to know what's coming next. The advantages of going with a startup if I'm a large enterprise is innovation, it's potentially getting to influence or be part of where that company goes. It's getting a competitive edge that I can't get somewhere else. And so, me as the seller, if I'm going to be selling that message to a large enterprise, I need to have confidence that the company is aligned to that, that we've got a technical organization that is going to be listening to the market. They're not creating things just for the sake of creating them or because they think they sound cool. They create things that customers want to buy, that they're listening to customers. One of the very first things I did when I got to Team Sense was I had what I called sell-to-me sessions. And so I had our CEO, our CTO, various folks that I would bring into deals to drive consensus and create executive alignment. I wanted to see how they would do in front of a customer. And if you've been selling for any period of time for startups, you know that there's some folks that aren't great in front of customers. And that's okay. Like they have other value to the organization. But as a customer representative, I want to know exactly who I'm bringing into my customer. I want to know exactly what kind of an experience it's going to be for them. And so I would I would attempt to suss some of that out even in the interview. Is this an executive team? Is this a team of leaders that I know I can put in front of a customer? And it's going to increase credibility and it's going to add to my chances of winning rather than make the customer kind of look sideways and think, uh oh, like, are these folks for real? Or can we trust them? This so much of selling to a large enterprise from a startup is proving credibility and trust. And so that would be a big part of it.

Andrew Kazlow 37:55

Love it. Super helpful. Rob, I want to ask about the season of life post-cloud era, but before your next thing. I was reviewing your background and noticed you took a season of sabbatical. I'd love to just unpack that a little bit. I don't see leaders often do that, but I have a lot of respect for it because we only get one life, and taking time off to highlight like what's important and reorient, I think is just such a wise thing to do seasonally. So I wonder if you could just tell us more about that season. Why did you do that? And what stood out to you during those months?

Rob Balena 38:32

We could have several podcasts about that. I will attempt to give you a succinct answer. The shortest way to share it is Cloudera took a very large investment from Intel, and Intel was a very important part of our investment team. There was a policy at Intel, and I believe I'm getting this right. If you had been at Intel for seven years, you were able to take a seven-week paid sabbatical. And so when we took the investment, one of our founders, Mike Olson, said, This is a great idea. Let's do the same thing at Cloudera. And so if you've been at Cloudera for seven years, you could take a seven-week sabbatical. And you know, they had backdated my start date to when I had started at Gazang pre-acquisition. And so I've got this sabbatical coming up. I wonder what I'm going to do with it. And then as chance would have it, I have four children during the birth of my fourth. There was a complication, and my wife had a medical emergency that required a lot of care. And so I ended up using my seven-week sabbatical mostly to care for her. It wasn't quite the, you know, trip to Europe kind of thing that we were hoping for, which was great. What a cool thing that like uh the company allowed me time and space to do that and everything. But the sabbatical wasn't what we expected. So when it came time for me to leave Cloudera, you know, Cloudera had changed a lot. It had grown. We had merged with a competitor, we were headed for PE. And so I decided, okay, I think I think I'm gonna go find something different, but I'm not sure what to do next. And my wife said, well, you know, we never got our sabbatical. Maybe we take a sabbatical. And I said, okay, let's do it. So that was, I think it was November of 19. We decided to take a sabbatical that would kind of take us into the new year. Once the new year starts, then then I'll go find a new job. And so, and it was great. I checked a whole bunch of things off my list. I invested in time with friends, I got to be with my four children. And my wife and I did a lot of focus time on our marriage and just making sure that we were headed in the direction that we wanted to be, both like professionally and as a family. That those were the inklings of things that started that eventually led to me relocating to rural Tennessee, uh, which is another interesting story. But get into the new year, it's 2020, then COVID hits, and suddenly all four of my kids are at home. And I'm like, okay, I gotta like, I can help out with this. I've still got a little runway left. And so I was educating my four children in the spring. And then it was that uh late that spring when I started sort of moonlighting, doing some individual coaching, some connections that I had in the Austin area had asked me, like, hey, would you do this on the side and are you taking time off? And found I really enjoyed it and eventually led to me starting a business around it.

Andrew Kazlow 41:04

Amazing. And when we spoke previously, you mentioned that after a while you just realized you kind of missed being in the game a little bit. And I wonder if you could say more about kind of that self-awareness exercise during that season and as you got into the coaching world. Talk to me about your mental process of just realizing that about yourself and what led to your ultimate decision to sit in the seat you're at now.

Rob Balena 41:31

My wife and I have a concept of checkpoints. And the idea is whenever we make a major decision, we set a checkpoint in the future. And we agree that at that checkpoint, we are going to like from the foundation soup to nuts, assess is this the right decision? Is this where we want to go? But until then, we will not doubt our decision unless there's you know some sort of catastrophe or something. And that very simple system has like allowed me to weather some really big professional and personal storms that have ended in really good things on the back end. Gazang was a great success story. You had Larry Warnock on the podcast a few weeks ago. He was the CEO at Gazang. It was not all sunshine and lollipops. Like we did, you know, market pivots and there were changes in sales leadership and all kinds of goofy stuff that any wiser man probably would have jumped ship at some point. But I had a checkpoint where I was like, I'm sticking with this thing until they fire me or until we hit the checkpoint. So started the business, loved doing differential selling. That was the name of my business. And it was individual sales coaching for enterprise sellers selling from startups to large enterprises. And then I did, you know, workshops for sales kickoffs and things like that on the side. Amazing, fun, very stimulating. It was a lot of thought work and very creative process. But as I finished my second year, rounding into the third, our checkpoint was at the end of the year. And so we were sitting down to talk about it. And I was like, I'm a little antsy because I spend all my time talking about doing this thing that I love. And I don't really spend any time doing it. I wasn't selling giant enterprise deals of enterprise selling. I was selling relatively small deals of these engagements for coaching. And it was usually with one stakeholder, the sales leader or the CEO of the startup I was working for. I was like, I spent a lot of time talking about what I'm doing, but I don't actually do it. And then quite frankly, I hope I don't embarrass him. But Adam St. Clair, who's here at Team Sense, he was one of my coaching clients. And our engagement when I was at Differential was I loved all of my coaching clients. He's special. We built a really special relationship. And I found myself, as we were sort of nearing the end of that engagement, being like, oh man, I want to spend more time with Adam. I want to go watch him put into practice the things that we've done. And I want to see the fruits of his labor. In my coaching, I did a lot of hands on stuff with folks and we listened to calls together and we would spend time, but it wasn't appropriate for me to like go on site to a customer with my clients. And so I was like, man, I want to go with Adam. I want to see him in action. On a customer site that eventually had that conversation with my wife and had a kind of an open conversation with Sheila Stafford, CEO of Team Sense, and said, Hey, I'm thinking about turning off my business and going to be ahead of sales somewhere because I I have this desire, I have this feeling that I want to go do. And she said, Would you consider Team Sense? And so one thing led to another, and here I am.

Andrew Kazlow 44:19

Amazing. Well, you talked about storytelling earlier. You certainly got that down. Talk about what you have been surprised by as you've double-clicked over the last couple of years in this role, leading a whole team, kind of this. I think you've got six people under you, seven.

Rob Balena 44:38

A whole go-to-market team today is five, six. There's a whole story here. So sales leadership is hard. It's really hard. And like I having done this role for 18 months, it was like, oh, I suddenly have so much more respect and empathy for those sales leaders that were trying to get me to fill out my forecast or nailing me because I didn't have the CRM updated. And I was like, now I get it. Now, now I'm not just the free and loose sales guy that does whatever he wants. It was also challenging too because I was never just a frontline manager. Most folks, they're a seller, and then if they want to go the management path, they're going to be like a regional director or something. And I went straight to the top sales job at a startup. I don't think that I appreciated the amount of time and focus that would it would require of me for things like building out process and building out a CRM and understanding the operation. I did that with mixed success for sure. And actually, it eventually led me to late uh spring, early summer, where I got a fantastic relationship with my CEO, Sheila, and just sat her down. I was like, Sheila, I miss selling. I miss being in front of customers. And I thought when I took this role, it was like, oh, I'm gonna spend all my time coaching my team and being with customers. I spend way less time doing that than I thought. And there's this whole other side of the job that Team Sense requires that I don't enjoy and I don't really think I'm particularly good at. I've worked for other sales leaders that I know are excellent at instrumenting a business and creating process and enforcing process. And she's such a fantastic leader in that she like really understands a person's strengths and weaknesses and gives people space to figure that out. She was willing to let me decide to take a role being a strategic seller at Team Sense. And so I moved into that role in the fall and have been doing that since then and got to be part of the team that found my replacement. And he started just a couple of months ago, James. I am honestly loving life a little bit because I get to do the thing that I'm really passionate about, which is go be with customers. I do miss coaching my team and Adam and Ramil, and they're still on the team and we're peers now. I miss spending time with them. I spend far less time with them now than I did since we're peers, but I do not miss the spreadsheets and the process and everything else. I do find that I'm so passionate about being with customers and walking alongside them. The role was exactly what I hoped it would be. It was a chance to try something new and build new muscle and experience something firsthand. We've got great investors who, Brett Queener, one of our first investors from Bonfire Ventures, and he spent regular time with me, coaching me and mentoring me and giving me space to mess things up and very grateful for that relationship. If nothing else, it got us 18 months further down the road at Team Sense with a bit of success to hang our hats on and really helped me hone in on what I'm passionate about and what I love to do. So grateful to be able to do it here.

Andrew Kazlow 47:42

Well, Rob, I'm certainly grateful for your time today sharing some of these insights. This has been fantastic. We will wrap things up there, but I very much look forward to staying in touch and our next conversation. Likewise, thanks so much. Thanks for listening to this episode of The Diligent Observer. I'm your host, Andrew. And if you're an angel investor looking for essential angel intel in five minutes every week, I think you'd enjoy my newsletter. I send my best stuff, interesting deals, and more straight to your inbox so you never miss a thing. Subscribe today at thediligentobserver.com.